Reinsurer Swiss Re has invested in carbon dioxide air capture technology company specialist, Climeworks’ CHF 600 million (USD 650 million) equity round, which marks a major milestone for the company, and an even bigger step for the carbon removal industry.
Last August, Swiss Re signed a ten-year purchase with Climeworks to help tackle climate change using direct air capture and storage of carbon dioxide.
Within the agreement, both companies also agreed to collaborate on developing risk management knowledge and risk transfer solutions.
The latest report by the Intergovernmental Panel on Climate Change (IPCC), released on April 4, reconfirms that carbon dioxide removal is essential to limit global warming to 1.5°C.
In addition to drastic emissions reductions, carbon removal solutions need to be deployed at scale to remove historic, and residual CO₂ emissions to reach net-zero emissions by 2050, and eventually net-negative emissions.
In a statement, Swiss Re said: “Carbon removal is a critical tool in confronting climate change. Last year, Swiss Re reached an important milestone on its road to net-zero by signing the world’s first long-term purchase agreement for direct air capture and storage of carbon dioxide with Climeworks. We are now also participating in the company’s most recent financing round and are looking forward to be part of Climeworks’ future journey as it expands its market leadership and scales up the technology needed to reach world’s decarbonisation goals.”
The financing was co-led by Partners Group and GIC. Along with Swiss Re, further participation came from Baillie Gifford, Carbon Removal Partners, Global Founders Capital, John Doerr, M&G, as well as other new and existing shareholders including long-term investor and anchor shareholder BigPoint Holding AG. J.O. Morgan Securities LLC served as sole placement agent for Climeworks in connection with the transaction.
The trust that has been placed by these high-quality investors is a testament of Climeworks’ strength as the most advanced direct air capture player and as pioneer of the carbon removal industry.
The funding will also help to unlock the next phase of Climeworks’ growth, scaling direct air capture up to multi-million-ton capacity and implementing large-scale facilities as carbon removal becomes a trillion-dollar market.
Since its foundation in 2009, Climeworks has pioneered direct air capture technology and is the most advanced industry player, with the world’s largest direct air capture and storage plant launched in September 2021.
Christoph Gebald, co-founder and co-CEO of Climeworks commented: “We are proud to partner with our new investors and thankful for the renewed trust of our existing ones, all committed to the long-term journey of Climeworks. It is thrilling to see the appetite and support of globally leading investors towards the scale up of our technology; this is a great milestone for our company as well as the entire industry.”
Jan Wurzbacher, co-founder and co-CEO of Climeworks added: “We founded Climeworks with the vision to provide the world a tech that has the potential to reverse climate change. Accelerating the scale up of carbon removal capacity will play a crucial role in global efforts to keep global warming under 1.5°C, positively impacting the lives of billions of people. And this is what we will do starting now.”
